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TMI Blog2019 (6) TMI 507X X X X Extracts X X X X X X X X Extracts X X X X ..... e to insistence on the Department s part who prevented Rasoi from utilizing the credit lying in RG-23B Part-II Register, although entitled to - the Department is bound to pay Rasoi interest, as has been correctly held by the Commissioner (Appeals). Interest on duties of ₹ 4.10 crores for the period from three months after the date of filing the refund application till the date of refund - HELD THAT:- The undisputed facts are that the refund application was filed on January 19, 2006 and the period of three months expired on April 18, 2006, but, however, the refund was granted on December 24, 2009. Hence, as per Section 11BB of the Central Excise Act, the Department is liable to pay statutory interest from April 19, 2006 to December 23, 2009 - the Commissioner (Appeals) has correctly allowed the claim for interest for the period April 19, 2006 to December 23,2009 on the duty amount of ₹ 4.10 crores. Claim for interest on delayed payment of interest - HELD THAT:- This issue is no more res integra. It has been held by the Hon ble Supreme Court in the case of COMMISSIONER OF INCOME TAX, GUJARAT VERSUS GUJARAT FLUORO CHEMICALS [ 2013 (10) TMI 117 - SUPREME COURT] , t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated June 9, 2004 the writ petition was allowed by the Hon ble High Court. The Special Leave Petition preferred by the Revenue against this judgment, being SLP (C) No. CC 2314-2315/2005, was dismissed by the Hon ble Supreme Court by an order dated March 7, 2005. Thereafter Rasoi was allowed to take credit in its PLA the duty of ₹ 4,46,62,485/- and to debit equivalent amount of duty in RG23B Part-II Register. 2. In the meantime, with effect from March 1, 2005, Vanaspati was again subjected to Nil rate of duty. On this date, Rasoi had an unutilised balance of ₹ 4.10 crores in the PL Account. Hence Rasoi filed an application for refund of the said ₹ 4.10 crores under Section 11B(2)(b). The said claim was, however, rejected by the Assistant Commissioner. On appeal by the company, the order of the Assistant Commissioner was reversed by the Commissioner (Appeals) and the refund claim was allowed. Revenue s appeal against this order was rejected by the Tribunal on January 15, 2008. Appeal filed by the Revenue against the Tribunal s order was dismissed by the Hon ble Calcutta High Court by a judgment dated July 28, 2008. Revenue s SLP (Civil) Nos. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty due to the Department rejecting its claim for exemption. The duties were realized during pendency of the appeals. The matter was ultimately decided in favour of the assessee. Before the Hon ble Supreme Court it was claimed that on the amounts in question the Department is liable to pay interest. The said claim for interest was allowed by the Hon ble Supreme Court by directing the Department to pay interest @6% per annum from the date of recovery of the amounts till the date of refund. 7.2 In Sandvik Asia Ltd. Vs CIT .2006 (196) ELT 257 (SC), the Hon ble Supreme Court directed for payment of interest due to delay on the Department s part in granting the refund. After referring to various earlier decisions on the issue, in paragraph 29 of the judgment the Hon ble Supreme Court held, inter alia, as under: In our view, the Act recognizes the principle that a person should only be taxed in accordance with law and hence where excess amounts of tax are collected from an assessee or any amounts are wrongfully withheld from an assessee without authority of law the revenue must compensate the assessee 7.3 In Plas Pack Industries V ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n January 19, 2006 and the period of three months expired on April 18, 2006, but, however, the refund was granted on December 24, 2009. Hence, as per Section 11BB of the Central Excise Act, the Department is liable to pay statutory interest from April 19, 2006 to December 23, 2009. The contention of the Department is that the period of three months has to be computed not from the date of filing of the refund application but from the date of the Commissioner(Appeals) s order, i.e. from 14/21.09.2006. 8.1 We find that this issue is covered by the judgment of the Supreme Court in Ranbaxy Laboratories Ltd. Vs. Union of India , 2011 (273) ELT 3. In the said judgment the Hon ble Supreme Court held as under : Manifestly, interest under Section 11BB of the Act becomes payable, if on an expiry of a period of three months from the date of receipt of the application for refund, the amount claimed is still not refunded. Thus, the only interpretation of Section 11BB that can be arrived at is that interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under sub-section (1) of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sits lying in the Account Current is specifically covered by Section 11B(2)(b) of the Central Excise Act, 1944. As held by the Hon ble Madras High Court in CCE Vs. Rajalakshmi Textile Processors (P) Ltd., 2008 (221) ELT 38 (Mad) and by the Hon ble Gujarat High Court in CCE Vs. Reliance Industries Ltd. 2010 (259) ELT 356 (Guj.), when the refund application was filed under Section 11B and was allowed under Section 11B(2), as in the instant case by the Commissioner (Appeals), the provisions of Section 11BB are automatically attracted for payment of interest. 8.4 Respectfully following the above stated decisions of the Hon ble Supreme Court of India and the Hon ble High Courts on the issues involved, we are of the view that the Commissioner (Appeals) has correctly allowed the claim for interest for the period April 19, 2006 to December 23,2009 on the duty amount of ₹ 4.10 crores. 9. The third part of the claim for interest, being the subject matter of the appeal filed by Rasoi, is a claim for interest on delayed payment of interest. This issue is no more res integra. It has been held by the Hon ble Supreme Court in the case of Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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